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PS2 Vs. X-Box: Winner Emerging?
gripdamage writes "This article on
MSNBC says XBox's sales are slowing and are not expected to meet Microsoft's
expectations. MSNBC previously
reported that sales have been weak in Japan. The strongest and most
interesting assertion in the article is that "In its regular global video game survey last week, Goldman Sachs said U.S. retailers showed a
'surprisingly clear' preference for Sony Corp.'s PlayStation 2 over the Xbox."" X-Box isn't dead yet - not by a long shot.
I recv'd my PS2 during the downturn. I also heard on TV that consumer electronics was one of the few areas that was not hard hit by the downturn. That included the PS2 and XBox.
I believe it mentioned something about people looking for a way to half-escape reality.
I honestly believe that it was the fact of few games, horrid controller, and did I say horrid controller?
The PS2 had the niche already. MS is going to have a really tough time breaking in IMHO.
...is a lack of high-quality games. I can count on one hand the number of X-box games that are worth the price. We always go back to Halo...the other games just can't measure up. When I buy a game system, I expect to have a decent game selection. X-box, when compared to PS2, just doesn't have that.
What the heck does the RETAILERS opinions of the boxes have to do with things?
A retailer's relationship with a manufacturer/product can make a lot of difference between a product that sells well and one that doesn't. A good example of this is in grocery stores where the store brand gets preferential treatment -- better placement, more advertising, slightly lower cost -- over the name brand. I've even seen grocers put name-brand products in odd locations (for example, name-brand crackers in a completely different aisle from the rest) or just not carrying popular brands at all. If you shop at King Sooper's or Safeway (I forget which) in Denver, you can buy three generic brands of fig cookies, but you can't find Fig Newtons in the store at all.
If you are a retailer you decide things like how many units to carry, store placement, promotions and so forth. If a product is in high demand, there's not much a retailer can do to dissuade people -- but if a product (like the XBox) is trying to make inroads into an existing market with a popular front-runner (like the PS2) how retailers treat the product can make a lot of difference. Since Microsoft isn't selling the XBox direct to the public, they have to depend on retailers. (Having a direct outlet is a double-edged sword -- retailers tend to dislike companies selling their products directly, because they have an incentive to take sales away from the retailer (more profits) and can afford to sell the product cheaper than the retailers.)
If a product doesn't have decent margins or you don't have a good relationship with the vendor (or both) you can certainly understock the product and hope that people will go to the competition's product and kill the products you don't like. I'm not saying that's happening with the XBox, but if several large retailers like Best Buy decided to promote the PS2 more heavily it could certainly have a negative impact on XBox sales. (I doubt this is the case...their margins on the XBox can't be much lower than on the PS2, which has virtually no margin. Game titles are where they make their money, and I imagine the margins are about the same for XBox and PS2.)
Oh, and speaking as someone who used to work in retail -- I don't care for "oily salesmen" any more than you do. The things I looked for were decent margins, stock when I needed it, a good return policy for unsold inventory and decent terms (net 30 or better).
but they can't get by on near-flat-shaded cartoonish games forever.
If they are damn good games, they sure as hell can.
Got Freedom?
Thinking?
This is true, and I'm sure is has some effect on sales, but really it doesn't matter.
How many of Microsoft's first products have been losers?
Quite a few. Remember the first time you tried IE? Remember the first time you tried Windows? Remember the first NT server you had to admin? You always thought there had to be a better way.
Microsoft is notorious, IMHO, for releasing losers that don't do well initially. It is their endurance that keeps them up there. They have the resources and can keep throwing money at something till it becomes a decent project, while other companies would have said, "Well, we tried to get into this market, but it didn't work. Let's not waste even more of our money..."
Instead, Microsoft is determined to be a player, regardless of what it costs - for they know in the long run they will have a good product that will increase market share and make money. Once they get to that point, they want to control the market.
So, look beyond the X-Box and think about the future... The X-box may not be it, but you can guaran-damn-tee that it does not stop here for Microsoft.
Moon Macrosystems. Sun's biggest competitor.
Halo's out for PC (or at least, will be? Not sure).
Don't need to spend $350 for Halo + XBox.
Most people who would want to play Halo already have a computer easily powerful enough to play it (you could probably spend $500 and make one!). MS needs to get rid of the everpresent thought of gamers that since Microsoft makes XBox, and Windows, games that come out for XBox come out for Windows. I think in the back of most people's minds, they already think this, and so "exclusives" don't feel like exclusives. MS needs to make REAL exclusives.
Exclusive games come out nowhere else. Look at the Final Fantasy series: FF7, 8 came out on PC, but it's highly unlikely any others will. So no one considers that the FF series will show up on PC (FFXI excluded because of the online stigma it carries). If you want to play FFX, buy a PS2. That's why people buy consoles. That's why I bought my Super Nintendo back in the day. That's why I bought my N64. That's why I bought my PS1.
MS NEEDS to get rid of the idea that the exclusive games will show up ANYWHERE else. And unfortunately, their track record just isn't good at doing that.
The Dreamcast failed because 3rd party developers didn't trust that Sega would stick with the Dreamcast - they were right. Sega has a history of constantly jumping console ship, so the developers were worried about that. If you take a look at Microsoft, again, I'd imagine that most developers would opt to develop for the PS2 first, and then port it to the X-Box. And a system with tons of ports doesn't survive.
It's a bad, recurring nightmare for MS. The low barrier to entry doesn't matter if your games have no shot in hell of succeeding and doing well. So MS needs to get more consoles out there, and more "this game will show up nowhere else" idea. If they don't, give up.
And people who say "XBox 2 and 3 will rule!" - I once again repeat - developers do NOT develop for a system that the producer doesn't seem to be interested in supporting. That's what killed Sega. It'll kill MS too, if they don't wake up.
Look at Windows CE: The first version was atrocious, the second version wasn't much better. Neither of them sold any copies of any significance, but with unlimited resources, competition didn't work and so a third version was made along the lines of dead third-party developers. This version isn't spectacular, but is starting to sell a bit more mostly because of Microsoft's first-party software like Office, Outlook and IE.
Now, take a look at what Microsoft's been doing with games; they've been ramping up first-party titles for quite a while now. Their lineup is getting impressive -- stuff like Halo, which used to be slated for a PC version now appears to be X-Box only. Look at the number of software houses out there, and look again at the unlimited resources Microsoft has. They can own this market if they want to; even if they have to buy EA and Square to get it. You can't compete against Microsoft if they are determined to crush you.
Sony can play dirty tricks like this as well, so this should at least be entertaining to watch as two mega-corps go at it. Somehow, though, I think we'll all be left with something that sucks as the end result (witness Windows). Nintendo is going to die off first, as a console maker anyway; they'll still make games for other consoles like Sega does, and their handheld line will continue until Microsoft puts out the X-Palm or whatever.
The wheel is turning, but the hamster is dead.
Games have always been huge, Nintendo is in business still because they get games made that people end up buying the box for. The Zeldas and the Marios and what have you. PS2 has some killer games, GTA3, VF4, SOE, MGS2, Ico, GT3, Jak and Daxter, FFX, and more. MS is operating with a deficit in this department. One or two good games just doesn't do it at this point for them.
Focus is also key. Nintendo and Sony are focused on games. MS sees the Xbox as their gateway to your living room. They see IE on you TV, PVR on Xbox. They've been meeting with satellite and cable vendors to get integrated with them. They want windows and office on your tv. The games are secondary.
We've known from the start that they'd take a hit on it, it's just a matter of how big of one they are willing to tolerate before they can it. What's it worth to them? $1billion? $1.5billion? We might find out. Even they can't take a loss forever and they won't. I've long thought that they would have to hit a home run to really matter because unless they clearly hit it out of the park they've got everything working against them, Sony and Nintendo beat them on cost, catalog, they've got history and reputation, they're Japanese and can expect to sell a few copies in Japan based on that alone. MS has made a good product but it's clearly not an unstopable killer. Sony still has the FUD card to play, just now when they can seriously cost reduce the Ps2 (they have a single chip solution..) they can also start talking about the PS3 that will be out in 18 months..